Mitchells & Butlers (M&B) investor Piedmont has accused the board of presiding over a "culture of obfuscation and excess" and denied that it is trying to gain control of the managed pub operator.
In an open letter to shareholders Piedmont, the investment vehicle of Joe Lewis, expressed its "grave concerns" over the way the M&B board had presented a "highly partial, misleading and prejudicial account of events".
M&B said that it would support the appointment of Piedmont nominees Simon Burke and John Lovering to the board but would not support the appointment of Michael Balfour and Jeremy Blood.
"We believe that the way in which the Board has conducted itself around the events of the past few weeks reflects a wider malaise in the corporate governance of M&B," said Piedmont.
"This Board and its advisers are predominantly the same group of individuals that have cost shareholders £500 million through their mistakes in recent years and have presided over a culture of obfuscation and excess.
"Piedmont's active and involved engagement over the past year has been entirely consistent with the best norms of corporate governance.
"The Board's conduct, by contrast, has been characterised by a desire to preserve the interests of a small group of individuals rather than a concern for the best interests of the Company."
Complete overhaul
Piedmont reiterated its belief that the board needs a "complete overhaul" and a review of its key advisers. It refuted allegations that its four nominees would not be independent but would serve Piedmont.
It added: "Let us be absolutely clear: Piedmont has never sought to take control of M&B — nor does it seek control now — as the current Board has alleged.
"Our perspective is simply that the Company is a long term value proposition — for us and all shareholders. The continued evolution of the UK from a pub oriented marketplace to a more dynamic, pub and restaurant sector presents an opportunity for M&B to grow market share and increase margins.
"But for its full potential to be realised we believe that the Company needs a complete overhaul of the Board, and a review of its key advisers.
"In summary, we would urge all shareholders to closely examine and challenge the version of events advanced by the Company.
"We maintain that the interests of all shareholders will be best served by the infusion of independence, vigour and a fresh perspective in the shape of the four nominees.
"Piedmont therefore strongly recommends that shareholders vote for all of the four candidates at the AGM on Jan 28."
M&B has yet to respond to the letter.
• Ypu can read the full letter here.